10 Easy Steps to Outsourcing Your HR Needs


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  • Jay’s part
  • Jay’s part
  • Jay’s part
  • And thank you Jay for the intro! Hi everyone! Welcome and thank you for joining today’s webinar titled “10 Easy Steps to Outsourcing your Human Resources Needs” Let’s get started!! In this webinar, some of the key points that you will take away are… Why outsourcing is good for business? How to determine if it will work for your organization? And…The 10 steps you will need to know to get started!
  • Now, let’s have a look at today’s agenda… In today’s webinar we will be covering … 1. What is HR Outsourcing? 2. The History of Outsourcing 3.Research & Results 4.Why Do Companies Outsource? 5. 10 Steps to Effective HR Outsourcing 6. And we also have a Special Offer from Drake International for the participants of this webinar - so stay tuned to the end and we will fill you in on what we have to offer you for attending this webinar!
  • So what is HR outsourcing and what does that actually mean for your organization? Well- Managing human resources through the HR outsourcing model involves specialized activities such as training, payroll administration, employee database management, employee retention, employee benefits and a lot more that many companies either don’t have the proper resources for OR the time to manage on their own. By outsourcing their HR functions companies can save huge amounts of money and be free of complications that are otherwise involved in maintaining an internal HR department. By doing so, companies can concentrate on their core business by saving their valuable time and resources. To sum it up, human resources outsourcing includes recruitment outsourcing to help cut costs, it helps concentrate on the core business, and most importantly helps by ensuring employee satisfaction.
  • General business process outsourcing is a longstanding practice in a variety of other fields including Accounting/ Legal and Payroll. These are processes that we have outsourced for quite a long time now. With that said… HR Outsourcing is not a new concept Actually, In 1999, Multinational Oil and Gas conglomerate “British Petroleum” made the epic decision to outsource almost all of its HR processes. Thus! began the human resources outsourcing revolution. Over the decade later, the HR process outsourcing revolution had grown swiftly – this was adopted not only by large companies but also small to mid sized operations have started to pick up on it as well. This really has led the way for Human Resources Outsourcing models all over the world!!
  • It should come as no surprise that “cost savings” counts as one of the top reasons companies are turning to HR Outsourcing. If we look at some of this research… In fact, data from the Watson Wyatt Worldwide indicates that the average operating expense for HR functions for each full- time HR employee is $284,982. This figure doesn’t include training costs or payroll, which are not considered traditional HR Functions by a consulting firm. Towers Watson has regularly undertaken studies and prepared reports on the effectiveness of Human Resources Outsourcing projects with findings around… Cost reduction and human resources Service Quality -Cost reduction: that was the top goal driving the human resources outsourcing for 73% of the respondents And also, -50% of polled companies that said that improving HR service quality was a top goal of their human resources outsourcing efforts
  • So… Why Outsource??? The answer is simple: FOCUS ON THE CORE BUSINESS- Business leaders did not enter into business to manage human resources functions, but rather to discover innovative ideas to improve, to increase market share, to find better strategies for winning over their competition, and to increase customer loyalty. HR management functions can be complex, requiring time, energy, and resources to handle in-house. Processing such functions such as benefits planning, recruiting, training, personnel filing , payroll, performance reviews, and managing leaves must also be handled accurately and efficiently. IMPROVE THE BOTTOM LINE - By outsourcing your HR you will gain the time and energy to give your focus back on the core business, which will in turn, add to the bottom line of your business. TAKE ADVANTAGE OF SPECIALIZED KNOWLEDGE - Not only will outsourcing give you access to a Subject matter expert but in some cases it will give you access to a whole team of Subject Matter Experts with a much wider reach of expertise. As we say at Drake- Why Pay a Full Time wage for a Part time job?
  • Now let’s take a look at a brief overview of the 10 steps to outsourcing your HR Processes step by step First of all we will map out your “As Is” state… Then do an HR Health Check or Audit then cost it out your savings in the long run Build yourself a business case for outsourcing your HR. You have to gain buy in from your internal stakeholders Step 5 - Educate yourself on what HR functions initiatives that you are lagging in, do some competitive analysis, or perhaps do some more research about what HR outsourcing really is. Go to market and start shopping around and make sure you do your research on HR outsourcing providers – which will bring you closer to… Step 7 Choose your subject Matter expert who you feel is a fit to partner with… Next Step 8 -Purchase and Implement a customized program tailored to your organization Step 9 -Change Management - changes don’t just happen over night. You have to act as a change agent to allow for change to fully happen and a real effort needs to come into play in order to overcome any resistance to change. Lastly Step 10 - Staying on track You have to see this project to the end. Keep on track and stick to your decision of initiating this this change
  • I’m going to go through each of the steps one by one now… Knowing what you know, how do you now proceed? Step 1 – Map out your HR processes throughout the entire employee lifecycle as it is now. So- what are you currently doing? And what are you currently not doing in house? How your current processes actually look like? - your recruitment? your on-boarding programs? your performance management? Your compensation and benefits? your training? your career development process? your succession planning,? and lastly your exits and career transition process? - Mark sure you have a good look within your organization!
  • Step 2: Complete an HR “Health Check” Identify areas within your human resources department that are inefficient and too expensive Once you have completed mapping out your current processes, now we need get a feel for what you are doing well and what you are doing badly- then- we can look at what “ doing it badly” is actually costing you
  • Step 3: Cost these areas out in actual dollars Add the following factors… there are 3 factors in total: First… The cost of a Human Resources full time wage.. Then add… The cost of HR inefficiencies (so for example: the cost of mistakes and waste, the cost of time for each HR process, the cost of low productivity, or the cost of staff turnover) then add… a Projected 5 % improvement With that said, Don’t just outsource for the sake of outsourcing. Take whatever metrics apply and work for your organization and cost them out. So we need to know the metrics around what you are doing and what this is costing you!
  • Step 4: Build your business case Have a Look at “what you are doing badly’ and what this is costing you, including in that figure- the cost of time. Project- lets say a 5-10% improvement- what would that mean for you? And - What should this be costing you if you are doing these things well?
  • Step 5 - Educate yourself There are different ways of learning more about human resources outsourcing initiatives. Some different ways are… to Attend webinars - most webinars are free and easy to access from your own home Attend some seminars – there are usually sessions where you can network afterwards or during seminars. That’s a great way to meet and listen to subject matter experts and also you can learn more about different vendors out there as well Internet searches- look up vendors in your area and see what different programs they have to offer Read and research - constantly learning more and doing more research will only benefit you and help you improve your business goals Find and speak to subject matter experts- meeting with subject matter experts is a good way to get complete answers to all of your questions Now that you know what your current processes are, what you are doing well…what are you doing badly…. and what it costing you? You can make your decision on whether it makes financial sense to go to market.
  • Step 6 Go to market So here you want to find yourself a pool of vendors that specialize in the areas you have identified as being poor performers in your HR processes. The most important point here is to hire a human resources outsourcing firm and knowing exactly what you are getting. Ask for specific details about service offerings and contract obligations. Consider how the service will fulfill your needs and how it will fit in with any other services that you may currently have or expect to adopt in the future.
  • Step 7: Find the Right Subject Matter Expert I suggest that you evaluate your potential subject matter expert using the following criteria Do they have HRIS experience under their belt? How many years of experience do they have with HR outsourcing? How many years of experience do they have in their field of specialization? What is their analytical competence? Do they have the ability to map systems and processes? or identify gaps? Or suggest solutions? How many past or present clients do they have? What is the scope and the number of successful implementations Do the Subject matter experts have Client testimonials to show you?
  • Step 8: Purchase and Implement Together with your provider you want to create a true partnership that is based on trust. Mentally accepting that your partner has the best interests of your business in mind will kick off the engagement to a great start. When people and technology are involved, it can sometimes be a bumpy road. Address each bump with a spirit of teamwork, expecting your partner will take full responsibility for the successful smoothing of bumps. A partner knows the solution is its responsibility. Support the staff of your partner as they attempt to solve problems and accept a familiarity period as the engagement begins. So…Together with your provider Create project plan that includes timelines - what are the tasks? and by when should they be completed? do some resource allocation – who is responsible for what? Develop a communication and feedback strategy Have regular project review meetings that discuss corrective actions Step 8 is really about formalizing the partnership… so! Make sure that contracts, service level agreements, non disclosure statements, access to HR systems, and induction training are familiar to you and you partner!
  • Step 9: Change Management Consider the impact on internal HR staff. Making the decision to hand over your HR processes to a third- party provider and know that there can be a traumatic effect on all in house employees. Be sure to communicate your rationale and strong business case for the outsourcing decision or be prepared to face plenty of attrition - this can lead to bulk recruitment, retention and training costs. Some things to consider are… -To have a clear communication to all stakeholders - let them know what the return on investment will be, and give them a clear projection on the benefits that your business can have from engaging in this change. -Know how to deal with stakeholder concerns - make sure you cover all of your angles. Think of every single question that you think they might ask you. Be prepared to go into depth with your projections. -Get senior leadership to support and champion the change and become early adopters – this makes it easier for the support to funnel down to the front line workers -Consider and Incentive or reward program for those who contribute to the success of the change implemented. OR perhaps a penalty system may be put in place to promote compliance
  • Step 10: The Continuing Relationship This is the continuing relationship down the road… So here you want to look at ways to ensure continuous measurement. Set performance measurements to track progress and also to ensure that the improvements that you set are in fact achieved. Nurture your project and take pride in the changes and improvements that were made to the bottom line of your company.
  • HR Help Line Think of it as road side assistance for your business! Coupled with their HR outsourced projects, many organizations utilize a HR Help Line which offers expert information on any HR related questions that you may have. The purpose of this is to be able to access a qualified experienced HR Professional through e-mail or phone which is quite cost and time effective. This is also a way to avoid costs of brining in an HR consultant or recruiting for a whole HR team to support your business.
  • So let’s take a minute to look back over what we have heard today HR outsourcing IS helping firms – whether they are large or small- to save money and drive results HR outsourcing provides an opportunity for HR professionals to contribute to your company on a strategic level- by aligning your goals with your performance HR Outsourcing isn’t for everyone, but every firm can benefit from some form of strategic HR outsourcing HR Help Line gives organizations advice on HR related questions which can in turn- help the bottom line of your business
  • Now it’s time to present you with our special offer from Drake International to all our webinar participants! Our HR consulting experts are offering a one month free of charge access to Drake’s HR Help Line to assist your business by having access 5 days per week to unlimited telephone and email HR advice!
  • (Jay to reinstate contact information for the special offer - before starting with the questions!) Jay’s part: Here’s our first question! 1.  How can we ensure that in handing over control of our processes it won’t result in even worse performance of our processes? Good question… I get that question a lot! Well, it’s always a gamble when you put the control of your business into someone else’s hands. So.. In order for an initiative to show progress, real time needs to be invested.  Keep in mind… that Change doesn’t just happen over night, and that message NEEDS be communicated to your team.  You really need to Keep your employees in the loop of all the changes and the progress and this will result in more people to not resist the change. With my experience …fear is one of the primary reasons that employees do not successfully implement change.  You really have to eliminate this fear for change.  Who ever the change agents are…must treat employees with a high level of  respect instead of approaching them with a dismissive kind of attitude. Doing all of this will eliminate barriers to change! I hope that answers your question! Thank you for that question! 2.  Second question…What could we expect to pay for outsourcing all or part of our processes?  What kind of timelines would we be looking at? It really depends on the scope of your outsourcing needs. Also, price and consulting hours must be considered as well. To get accurate pricing around cost… I suggest that you talk to a subject matter expert so they can cost it out to fit your needs. Thank you for that question!   Do we have time for one more question Jay? 3. What in your opinion is a better use of our resources -  Multiple Subject Matter Expert’s or 1 HR Generalist? Well- when you are starting a new HR initiative, then you want a handle on all the knowledge you can possibly get.  The question really is do you want to hire an HR consulting firm or hire on a full time HR generalist… If you already have an HR generalist, you can still benefit with having them partner with an HR consulting firm to push the internal staff to be strategic enablers.
  • Jay’s part
  • Jay’s part
  • 10 Easy Steps to Outsourcing Your HR Needs

    1. 1. 10 Easy Steps to Outsourcing Your Human Resources Needs with Manager, HR Partner on Demand Michelle Ganuelas Thursday, October 6 th , 2011 from 12 pm to 12:30 pm EDT For audio, you can use listen through your computer OR dial in to the teleconference Toll-Free: 1-877-669-3239 Event Number: 665 467 719 WebEx Support Line: 1-866-863-3910
    2. 2. Jay Rosales Senior Marketing Coordinator Drake International Email: jrosales@na.drakeintl.com Phone: 416-216-1070 (direct) Host: Jay Rosales
    3. 3. Michelle Ganuelas HR Consultant Drake International Email: mganuelas@na.drakeintl.com Phone: 416-216-1097 (direct) Presenter: Michelle Ganuelas
    4. 4. <ul><li>Why Outsourcing is Good for Business </li></ul><ul><li>How to Determine if it will Work for Your Organization </li></ul><ul><li>The 10 Steps You Need to Know to Get Started </li></ul>Key Take-Aways
    5. 5. Agenda <ul><li>What is HR Outsourcing? </li></ul><ul><li>The History of Outsourcing </li></ul><ul><li>Research & Results </li></ul><ul><li>Why Do Companies Outsource? </li></ul><ul><li>10 Steps to Effective HR Outsourcing </li></ul><ul><li>A Special Offer from Drake International </li></ul>
    6. 6. HR Outsourcing What is HR Outsourcing? What does it mean for your organization?
    7. 7. HR outsourcing is not a new concept. History
    8. 8. Research Based on survey data, cost reduction is the top goal driving Human Resource Outsourcing. (Towers Watson) The average operating expense for HR functions for each full-time HR employee is $284,982. This figure doesn’t include training costs or payroll. (Watson Wyatt Worldwide) <ul><ul><li>50% of polled companies said that improving HR service quality was a top goal of their HRO efforts. </li></ul></ul><ul><ul><li>(Towers Watson) </li></ul></ul>
    9. 9. Why Outsource? <ul><li>Three Major benefits: </li></ul><ul><li>Focus on the core business </li></ul><ul><li>Improve the bottom line </li></ul><ul><li>Take advantage of specialized </li></ul><ul><li>knowledge </li></ul><ul><li>Leverage the expertise of a team </li></ul><ul><ul><li>“ Why pay a full-time salary for a part-time job?” </li></ul></ul><ul><ul><li>Bill Pollock, Founder & Chairman of Drake International </li></ul></ul>
    10. 10. 10 Steps to Outsourcing HR Step 1: Map Out Your “As-Is” Step 6: Go to Market Step 2: HR Health Check Step 7: Choose Your SME Step 3: Cost It Out! Step 8: Purchase & Implement Step 4: Build Your Business Case Step 9: Change Management Step 5: Educate Yourself Step 10: Staying On Track
    11. 11. 10 Steps to Outsourcing HR Step 1: Map process throughout the entire employee lifecycle
    12. 12. 10 Steps to Outsourcing HR Step 2: Complete an HR “Health Check” Identify areas within your human resources department that are inefficient and too expensive.
    13. 13. 10 Steps to Outsourcing HR <ul><li>Step 3: Cost These Areas Out in Actual $ </li></ul><ul><li>Add the Following Factors: </li></ul><ul><ul><li>Cost of HR FT wage </li></ul></ul><ul><ul><li>Cost of HR Inefficiencies: </li></ul></ul><ul><ul><ul><li>Cost of mistakes & waste </li></ul></ul></ul><ul><ul><ul><li>Cost of time for each HR process </li></ul></ul></ul><ul><ul><ul><li>Cost of low productivity </li></ul></ul></ul><ul><ul><ul><li>Cost of staff turnover </li></ul></ul></ul><ul><ul><li>Project a 5% improvement (be conservative!) </li></ul></ul><ul><li>Compare this to the cost of outsourcing HR </li></ul>
    14. 14. 10 Steps to Outsourcing HR Step 4: Build Your Business Case
    15. 15. 10 Steps to Outsourcing HR <ul><li>Step 5: Educate Yourself </li></ul><ul><ul><li>Attend webinars </li></ul></ul><ul><ul><li>Attend seminars </li></ul></ul><ul><ul><li>Research (online/offline) </li></ul></ul><ul><ul><li>Talk to your network </li></ul></ul><ul><ul><li>Find and Speak to Subject Matter Experts </li></ul></ul>
    16. 16. 10 Steps to Outsourcing HR Step 6: Go To Market
    17. 17. 10 Steps to Outsourcing HR <ul><li>Step 7: Find the Right Subject Matter Expert </li></ul><ul><li>Evaluate using the following criteria: </li></ul><ul><ul><li>Experience with HR Information Systems </li></ul></ul><ul><ul><li>Experience in their specialized HR function </li></ul></ul><ul><ul><li>or industry </li></ul></ul><ul><ul><li>Analytical competence (ability to map </li></ul></ul><ul><ul><li>systems and processes, identify gaps and </li></ul></ul><ul><ul><li>suggest solutions) </li></ul></ul><ul><ul><li>Number of successful implementations </li></ul></ul><ul><ul><li>Scope of successful implementations </li></ul></ul><ul><ul><li>Client testimonials </li></ul></ul>
    18. 18. 10 Steps to Outsourcing HR <ul><li>Step 8: Purchase & Implement </li></ul><ul><li>Together with your provider: </li></ul><ul><li>Create project plan including </li></ul><ul><ul><li>Timelines (what-by-when) </li></ul></ul><ul><ul><li>Resource allocation (by-whom) </li></ul></ul><ul><ul><li>Communication / feedback strategy </li></ul></ul><ul><li>Regular project review meetings, corrective actions </li></ul>
    19. 19. 10 Steps to Outsourcing HR <ul><li>Step 9: Change Management </li></ul><ul><li>Clear communication to all stakeholders </li></ul><ul><li>Dealing with stakeholder concerns </li></ul><ul><li>Senior leadership to champion the change and become early adopters </li></ul><ul><li>Incentive, reward and penalty system in place to promote compliance </li></ul>
    20. 20. 10 Steps to Outsourcing HR <ul><li>Step 10: The Continuing Relationship </li></ul><ul><li>Continuous measurement </li></ul><ul><li>Performance management of vendor </li></ul><ul><li>Ensure improvements are achieved </li></ul>
    21. 21. <ul><li>Many organizations utilize a Help Line to seek HR advice though phone or e-mail </li></ul><ul><li>Help Line helps you avoid the costs of brining on a consultant full time </li></ul>HR Help Line
    22. 22. Haven’t listened until now? <ul><li>The Highlights: </li></ul><ul><li>HR Outsourcing is helping firms – large and small – to save money and drive results </li></ul><ul><li>HR outsourcing provides an opportunity for HR Professionals to contribute on a strategic level </li></ul><ul><li>This isn’t for everyone, but every firm can probably benefit from some form of strategic HR outsourcing </li></ul><ul><li>HR Help Line give organizations advice on HR related questions and can save the company money! </li></ul>
    23. 23. Special Offer <ul><li>Advice on HR related questions that you may have </li></ul><ul><li>We help only where you need it </li></ul>Michelle Ganuelas 416-216-1097 [email_address] ONE MONTH FREE access to Drake’s HR Help Line
    24. 24. Q & A with Michelle Ganuelas Manager, HR Partner on Demand 10 Easy Steps to Outsourcing Your HR Needs
    25. 25. Michelle Ganuelas Manager – HR Partner on Demand Drake International [email_address] 416-216-1097 (direct) Jay Rosales Senior Marketing Coordinator Drake International [email_address] 416-216-1070 (direct) Contact Us
    26. 26. October 20 th , 2011, 12 pm EST to 12:30 pm EST We Can’t Change the World, But We Can Change Our World – Overcoming the Constant Friction Between Hard and Soft HR Approaches >> Presented by Karen Meredith, Drake P3 Register at http://drake-webinars.com